I had already heard of problems with the helium supply chain. A fast investigation @ wikipedia revealed the true reason for the shortage:

It is not a problem of availability. It's just an issue of 'market'.A downtransient in helium prices, accompanied by the availability of the US helium reserve resulted in an increase in helium usage (even where other gases had been used before). On the other hand the industrial gas suppliers partly lost interest in the production (better: extraction) of helium from natural gas (the 'standard' source for helium).

NOW we have increased consumption paired with lowered production. An example of free market economy. The solution could be simple: when helium prices are going up the producers will produce. It might take some time to build/reactivate the production facilities ... A cycle that is well-known from the semiconductor industry.

Seriously though, where does the Helium come from? Is there not a small but retrieveable quantity in the atmosphere? Or does it all head up to the top of the atmosphere? Maybe there's a good sideline for airlines - mining helium from the higher atmosphere? If it's so critical, should we be using it in party balloons? Wouldn't Hydrogen be better for that? (yes, I know, some idiot would hold a match to a balloon sometime and sue someone.... :-)

I think we need more information here... why do we need to tap into the "reserves" and why does the current deal expire on October 7th? WHy can't current suppliers fill the need? I know there are companies, such as Air Products & Chemicals, that sell industrial gases. Not understanding the issue clearly.

1) there is a very finite amount of He left on the planet. Some estimates put it at between 25 to 50 years supply. He is a byproduct of natural gas production but is present in usable amounts in only very very few parts of the world.

2) As mentioned the USA hold about 1/3 of the worlds supply.

3) Not sure if this recently changed but in the past ALL He recovered from gas production was required to go into the government 'Reserves' and was allocated to primary distributers (Airgas, etc.) from there.

4) Sale price of He from the stockpile has NEVER followed a realistic pricing vs availability model. In the past the prices were far below what 'the market' would dictate. The recent astronomical rise in price for He - our cost has gone up 150% in the last 2 years plus we and most users are now on a need/allocation basis - is because the price controls were somewhat lifted along with the amount being released for sale has been reduced..

5) Sadly there is no viable replacement for its myrid of uses. Even widespread fusion projects running for a year would hardly fill 1-day of He consumption.

Some high volume uses: Aluminum wleding, magnet cooling for medical scanners, anything needing an inert yet thermal conductive process atmosphere, backfilling cryo storage tanks, CO2 and several other gas lasers (He is a buffer gas par-excellance). For all of these and many many more simply put, nothing can take it's place without serious complications to be overcome.

Wikipedia has a good run down on it, most comes from the US as a byproduct of gas mining. It is however finite and shouldn't be used in helium balloons at parties. I think something like 10 years worth is left on current usage.

There was a good article in the Washington Post last year on this problem. In 1996 the congress decided to get rid on the federal Helium reserve that was created (at an expense of $1.4 billion) in the 1960s. The problem was that they priced the Helium at about half what it was worth. That is why we can still use it for party ballons. I guess the hope was that by now the private sector would have stepped into the breach that the government was creating by ending the reserve. But that hasn't happened, perhaps because if congress changes their mind (again) and continues to sell it below cost then private industry could not make a profit. And so it goes...........

It is almost unique in its non-renewability. If we mine, say, titanium or gold or phosophorus and use it, we might degrade the resource but the atoms remain here on earth. When we use helium, in contrast, if we don't deliberately recapture it and have it recycled, it leaks into the atmosphere and escapes into space. Fossil fuels share a similar "one and done" situation, but in their case, there are renewable alternatives. For many if not most applications for helium, there is no obvious or viable alternative.

I agree whole heartedly with your idea of not allowing it's use in party balloons.

Fossil fuels however are part of a cycle. What will happen is long after we have fought our way into extinction plant life will eventually capture and store CO2 in fossil reserves so that in a million years we can find our way back into the mess we are now yet again.

This is a good, quick read from Popular Mechanics that says much of the same thing: articially low prices, an attempt at privatization of storage but private industry not interested. Seems like the low price at which the Federal govt. sells helium could be an enticement for industry to buy it at a low price, stockpile, and sell it at high price. Easier said than done.

Helium is a byproduct of the gas/oil industry. Radioactive decay of certain isotopes in the crust produce Alpha particles which bounce around a bit until they slow down and grab a couple electrons, thus becoming Helium atoms. They tend to rise up and are trapped in pockets of natural gas.

As a child I wondered for years about 'secret fusion reactors' since we're all told that helium comes from fusing hydrogen, but no one ever knew where Earth's helium supply came from.

@ Polyspace...many thanks for that. There's a big uproar here in Australia at the moment as Coal-Seam Gas (CSG) miners are running rampant all over our best farming land. However I have never heard of them extracting helium from it. Maybe because, as other posters have said, the price is artificially low. If someone as big (and supposedly savvy) as the US government can't sort this out, what hope is there?

@Prabakhar...I don't think it's that simple, and I have no idea if there is more helium at airplane altitudes than at the surface, or whther it would concentrate even higher up. The plane would obvoulsy have to have equipment that can (apart from gathering it) keep it cool. and it may not be economic (passengers might pay more, weight for weight...) but it would be interesting to know more about where the Helium actually is. Anyone got the answers?

It's crazy that we use it in silly things like party balloons if it's that rare.. I'm sure hydrogen (mix it with CO2 or Nitrogen if necessary) would do.....

David - A few years ago, I read that helium is the only element that, if left to its own devices, will escape the atmosphere. The other light gases will combine with something and end up too heavy to do the same.

I'm not sure how it would work though. Even being a very light element, I would think that it would just collect at some high altitude rather than bleed off into space.

I thought I had read that the government wanted to privatize and sell off the reserve. Was that really a discussion a few years back or am I thinking of something else. If I recall correctly, the general consensus was that doing so would be a pretty bad idea.

I worked in a low temperature physics laboratory and we used liquid He to in 25liter/8 gallon dewars in quotas per week. This was in the 90s and at time we were made very clear to recycle gaseous Helium to liquifying plant, which was attached to our facility.

There were times when we faced shortage of availability we felt that Helium should not be given to "MONKEYS" to fill balloons and decorate it for fun.

It is a great natural reserve, perhaps now the time has come to move the He(4,2) to the rare earth columns instead of the inert gas column of the periodic table for political reasons.

The worst thing that can happen is, companies lobbying to sell at high price to hospitals and other national facilities driving the costs up. It is still not too late to ban on the fun part and stick granting sales to licensed authorities with recycling facilities, however who would drive it is the question.

It may not sound very important to those who do not understand why losing He is very important, but one bad day will come where it is too late. May be next to Helium would be Hydrogen and water?